Geely Automobile Holdings Ltd (GELYF) (H1 2024) Earnings Call Highlights: Record Growth and ...

GuruFocus News
5 min read

In This Article:

  • Total Sales Growth: 41% year-on-year, reaching 956,000 vehicles.

  • Revenue: RMB107.3 billion, a YoY increase of 46.6%.

  • Shareholders' Profit: Increased by 574.7% YoY to RMB10.6 billion.

  • Profit Excluding Extraordinary Items: Increased by 114.4% to RMB3.37 billion.

  • New Energy Vehicle Sales: Grew by 116% YoY to 320,000 units.

  • Export Volume: Increased to 197,000 units, with export ratio rising from 17.4% to 20.7%.

  • Revenue Per Vehicle: Increased by 4.2% YoY to RMB105,000.

  • Gross Profit: Increased by 53.9% YoY to RMB16.2 billion.

  • Gross Profit Margin: Increased by 0.7 percentage points to 15.1%.

  • Sales Expense Ratio: Decreased by 0.6 percentage points.

  • Admin Expense Ratio: Decreased by 0.3 percentage points.

  • R&D Investment: Increased by 17.9% to RMB6.97 billion.

  • Total Cash: Reached a historical high of RMB41.488 billion.

  • Zeekr Sales: Increased by 106% YoY to 88,000 vehicles.

  • Lynk & Co Sales: Increased by 54% YoY to 126,000 vehicles.

  • Genius Auto Finance Net Profit: Increased by 3.2% to RMB670 million.

  • Active Contracts: Reached 1.45 million, a 9.1% YoY increase.

  • Full-Year Sales Target: Raised from 1.9 million to 2 million vehicles.

Release Date: August 21, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Geely Automobile Holdings Ltd (GELYF) reported a significant year-on-year sales growth of 41%, reaching 956,000 vehicles in the first half of the year.

  • The company's revenue surpassed RMB100 billion for the first time, reaching RMB107.3 billion, marking a 46.6% increase year-on-year.

  • Shareholders' profit saw a substantial increase of 574.7% year-on-year to RMB10.6 billion.

  • Geely's new energy vehicle sales grew by 116% year-on-year to 320,000 units, outperforming the market.

  • The company has a strong cash reserve, reaching a historical high of RMB41.488 billion in the first half of the year.

Negative Points

  • Despite the growth, Geely's results are not yet comparable to major competitors, indicating room for improvement.

  • The company faces challenges in maintaining profitability amidst fierce market competition and price wars.

  • There are concerns about the impact of potential European Union tariffs on Geely's electric vehicle exports.

  • Geely's international expansion strategy may face hurdles due to geopolitical and regulatory challenges.

  • The rapid iteration of Zeekr models led to customer dissatisfaction, highlighting potential issues in communication and product launch strategies.

Q & A Highlights

Q: What is Geely's strategy for international business expansion, and how does it plan to compete with local brands in international markets? A: Jia Yue Gan, CEO of Geely Auto Group, explained that Geely plans to expand its international business by increasing exports and exploring new markets, particularly in emerging regions like Kazakhstan and Mexico. Geely will also focus on Southeast Asia, the Middle East, New Zealand, and Australia. The strategy involves working with local partners and distributors, opening new plants in countries like Ghana and Egypt, and leveraging successful models like Proton in Asia. Geely aims to enhance its brand presence and competitiveness through these efforts.

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